This paper presents evolutionary models for very-low-mass stars and brown dwarfs with dusty atmospheres, focusing on objects with effective temperatures below 2800 K. The models incorporate synthetic spectra and non-grey atmosphere models that include dust formation and opacity. The interior of the most massive brown dwarfs develops a conductive core after about 2 Gyr, which slows their cooling. The models are compared with recent observations of late-M and L-dwarfs in optical and infrared color-magnitude diagrams. The saturation in optical colors and very red near-infrared colors are explained by the onset of dust formation in the atmosphere. The faintest L-dwarfs suggest dynamical processes like turbulent diffusion and gravitational settling near the photosphere. As effective temperature decreases below 1300-1400 K, the colors move to very blue near-infrared colors due to methane absorption. The paper suggests a possible dearth of brown dwarfs in J, H, K color-magnitude diagrams around this temperature. The models include the effect of grain formation in the atmospheric equation of state and opacity, leading to consistent non-grey atmosphere structure, spectral colors, and evolutionary calculations. The models are described in Section 2, and comparisons with observations in various color-magnitude diagrams are presented in Section 3. The paper discusses the remaining uncertainties and shortcomings in the theory in the conclusion. The models are tested against observations of late-M, L, and methane dwarfs in various CMDs, showing good agreement with observations in near-infrared bands but some discrepancies in optical colors. The paper also discusses the importance of near-infrared observations for studying brown dwarfs and the need for further improvements in the models to better understand the physics of these objects. The models are available for download via anonymous ftp.This paper presents evolutionary models for very-low-mass stars and brown dwarfs with dusty atmospheres, focusing on objects with effective temperatures below 2800 K. The models incorporate synthetic spectra and non-grey atmosphere models that include dust formation and opacity. The interior of the most massive brown dwarfs develops a conductive core after about 2 Gyr, which slows their cooling. The models are compared with recent observations of late-M and L-dwarfs in optical and infrared color-magnitude diagrams. The saturation in optical colors and very red near-infrared colors are explained by the onset of dust formation in the atmosphere. The faintest L-dwarfs suggest dynamical processes like turbulent diffusion and gravitational settling near the photosphere. As effective temperature decreases below 1300-1400 K, the colors move to very blue near-infrared colors due to methane absorption. The paper suggests a possible dearth of brown dwarfs in J, H, K color-magnitude diagrams around this temperature. The models include the effect of grain formation in the atmospheric equation of state and opacity, leading to consistent non-grey atmosphere structure, spectral colors, and evolutionary calculations. The models are described in Section 2, and comparisons with observations in various color-magnitude diagrams are presented in Section 3. The paper discusses the remaining uncertainties and shortcomings in the theory in the conclusion. The models are tested against observations of late-M, L, and methane dwarfs in various CMDs, showing good agreement with observations in near-infrared bands but some discrepancies in optical colors. The paper also discusses the importance of near-infrared observations for studying brown dwarfs and the need for further improvements in the models to better understand the physics of these objects. The models are available for download via anonymous ftp.